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(Adds central bank comment)
CAIRO, Nov 17 (Reuters) - Egypt's central bank kept its key interest rates unchanged on Thursday, two weeks after surprising markets with a 3 percent hike in its key rates.
The Monetary Policy Committee kept the overnight deposit rate at 14.75 percent and the overnight lending rate at 15.75 percent, as predicted by all 15 respondents in a Reuters poll.
The bank had already raised rates by a cumulative 550 basis points this year.
On Nov. 3, the central bank ditched its peg of 8.8 per dollar and hiked interest rates by 300 basis points to stabilise the newly floated pound. Its initial guide level was 13 to the dollar and on Thursday it allowed the pound to drift to about 15.75/16.00 per dollar
"Based on the targeted reserve money and the inflation outlook assessed in the extraordinary MPC meeting on Nov. 3, 2016, tightening monetary conditions was warranted," the central bank said in a statement.
"At this juncture and given the balance of risks, the MPC judges that the key CBE rates are currently appropriate."
Egypt has been struggling to revive its economy since a popular uprising in 2011 drove away tourists and foreign investors - both major sources of hard currency.
Last week, the country secured a $12 billion loan from the International Monetary Fund, on conditions it continues to push through painful economic reforms including imposing a value-added tax, cutting electricity subsidies and raising fuel costs.
The reforms contributed to a rise in Egypt's core inflation, which jumped in October although annual urban consumer price inflation eased for the second consecutive month after hitting an eight-year high in August.
Yields on Egyptian treasuries jumped significantly in auctions following the surprise hike on Nov. 3 but later dropped as demand for government debt rose.
On Thursday, average yields on six-month and one-year treasury bills dropped significantly at an auction.
The 182-day treasury bill yield dropped to 17.716 percent from 18.469 percent at the previous auction, and the yield for the 357-day treasury bills dropped to 17.606 percent from 18.903 percent in a similar auction.
(Reporting by Asma Alsharif; Editing by Catherine Evans) ((asma.alsharif@thomsonreuters.com; +20225783290; Reuters Messaging: asma.alsharif.reuters.com@reuters.net))
CAIRO, Nov 17 (Reuters) - Egypt's central bank kept its key interest rates unchanged on Thursday, two weeks after surprising markets with a 3 percent hike in its key rates.
The Monetary Policy Committee kept the overnight deposit rate at 14.75 percent and the overnight lending rate at 15.75 percent, as predicted by all 15 respondents in a Reuters poll.
The bank had already raised rates by a cumulative 550 basis points this year.
On Nov. 3, the central bank ditched its peg of 8.8 per dollar and hiked interest rates by 300 basis points to stabilise the newly floated pound. Its initial guide level was 13 to the dollar and on Thursday it allowed the pound to drift to about 15.75/16.00 per dollar
"Based on the targeted reserve money and the inflation outlook assessed in the extraordinary MPC meeting on Nov. 3, 2016, tightening monetary conditions was warranted," the central bank said in a statement.
"At this juncture and given the balance of risks, the MPC judges that the key CBE rates are currently appropriate."
Egypt has been struggling to revive its economy since a popular uprising in 2011 drove away tourists and foreign investors - both major sources of hard currency.
Last week, the country secured a $12 billion loan from the International Monetary Fund, on conditions it continues to push through painful economic reforms including imposing a value-added tax, cutting electricity subsidies and raising fuel costs.
The reforms contributed to a rise in Egypt's core inflation, which jumped in October although annual urban consumer price inflation eased for the second consecutive month after hitting an eight-year high in August.
Yields on Egyptian treasuries jumped significantly in auctions following the surprise hike on Nov. 3 but later dropped as demand for government debt rose.
On Thursday, average yields on six-month and one-year treasury bills dropped significantly at an auction.
The 182-day treasury bill yield dropped to 17.716 percent from 18.469 percent at the previous auction, and the yield for the 357-day treasury bills dropped to 17.606 percent from 18.903 percent in a similar auction.
(Reporting by Asma Alsharif; Editing by Catherine Evans) ((asma.alsharif@thomsonreuters.com; +20225783290; Reuters Messaging: asma.alsharif.reuters.com@reuters.net))
